I would forget the Asset Entry Worksheet and only use the Home Sale Worksheet (only enter the disposition date on the Asset Entry Worksheet and leave the sale price BLANK).

I would enter HER Basis and Sales Price (1/3 of the total amount) on the Home Sale Worksheet, and enter the depreciation (I think you also need to factor in the depreciation for when you enter the "Adjusted" Basis). 

Yes, leave the "Nonqualified Use" section blank.